A class action settlement involving the popular online tax preparation service, TaxAct, is underway. This legal settlement involves users of TaxAct's online federal tax filing service between two and six years ago.
The total settlement amount is about $14.95 million, and eligible customers may be entitled to compensation.
Here’s what else you should know.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
TaxAct lawsuit?
The lawsuit at the center of this settlement alleges that TaxAct shared users' personal and financial information with third-party entities, specifically Google and Meta (formerly Facebook), without obtaining proper consent.
Tracking pixels were allegedly used to collect and transmit user data for advertising. That included names, email addresses, income data, and other sensitive data entered during the tax filing process
TaxAct has agreed to settle but has not admitted wrongdoing.
TaxAct class settlement: How much is it?
The settlement applies to those who used TaxAct‘s online do-it-yourself 1040 tax filing product between Jan. 1, 2018, and Dec. 31, 2022.
- The official settlement website indicates the estimated individual payout for eligible claimants in the TaxAct settlement is approximately $18.65.
- California residents and joint filers may qualify for slightly higher amounts.
- Additionally, claimants planning to use TaxAct for their 2024 tax returns will receive complimentary expert assistance as part of the settlement.
You must meet the eligibility criteria and submit a claim form to participate. Eligibility is generally extended to those who used TaxAct's online service and had a U.S. postal code during the time covered by the settlement.
Claim forms can be submitted online through the official settlement website. Proof of purchase is not required.
Key dates:
- The deadline for submitting claims is Sept. 11, 2024.
- Those wishing to opt out of the settlement must do so by Sept. 11, 2024.
- Objections to the settlement must be filed by Aug. 12, 2024.
If you have questions about the settlement, contact the Settlement Administrator, Kroll Settlement Administration.
Email: info@TaxActClassSettlement.com and Toll-Free: (833) 425-9910. You can also contact the administrator by mail at the following address.
Smith-Washington v. TaxAct, Inc., c/o Kroll Settlement Administration LLC
PO Box 225391
New York, NY 10150-5391
TaxAct legal settlement: Bottom line
The settlement is part of a broader trend of privacy and fair advertising concerns in the tax prep industry. As Kiplinger reported, The Federal Trade Commission (FTC) recently filed complaints against Intuit TurboTax and H&R Block, accusing the companies of misleading consumers with advertising for their digital tax filing products.
While the individual payouts for the TaxAct settlement will likely be small, the situation is a reminder to remain vigilant about how companies use and share data we provide for online financial services.
Related
-
Are Living Trusts Worth It? Pros and ConsLiving trusts can help manage your assets (and taxes) while you're alive and transfer them after you die, but they have disadvantages, as well as advantages.
-
Don't Let Your Kids' Bad Financial Habits Drain You DryWhen adult kids make financial mistakes, their parents can suffer. So, step in early to help your kids succeed, instead of letting their regrets become yours.
-
IRS: How to Get a 401(k) Match for Your Student Loan PaymentSavings Those with 401(k), 403(b), and other savings plans might get relief through their employer-provided retirement account.
-
Kamala Harris Golf Tax and Unrealized Gains? What You Really Need to KnowElection 2024 There's a lot of social media talk about capital gains taxes and a golf tax. How much is real?
-
How Much Is the Child Tax Credit for 2024?Tax Credits The refundable amount of this tax break is slightly higher for the 2025 tax filing season. Here’s what you need to know.
-
IRS Urges Employers to Participate in ERC Voluntary Disclosure ProgramTax Credits Businesses can fix ERC claims with the IRS at a lower cost, but only for a limited time.
-
New Jersey Residents to Receive ANCHOR Direct Deposit or Checks in MailTax Relief NJ is sending millions in property tax relief — find out when and how much could hit your wallet.
-
How Many Retirement ‘Tax Buckets’ Do You Have?Retirement Diversifying retirement account types can lead to more significant and flexible tax benefits.
-
Fun Things to Do in Retirement With Added Tax BenefitsRetirement Taxes What should I do first when I retire? Well, it wouldn’t hurt to save a little on your taxes.
-
IRS Restarts Processing of Some ERC Refunds: What to KnowTax Credits Some businesses may receive employee retention tax credit payments as early as September.
